Key v. Norrod

Mr. Justice Green delivered the opinion of the Court. This suit was brought to recover judgment on a promissory note. The case resulted in favor of the defendant below, and was appealed to the court of civil appeals. That court affirmed the judgment of the circuit court, and a writ of certiorari was granted, and the case brought here. The defense made to the suit below was that the plaintiff and defendant had entered into an agreement to arbitrate all matters in controversy between them, and that an arbitration was had, which resulted in favor of defendant. The award was pleaded as a bar to the suit. The plaintiff admitted having entered into an agreement to arbitrate these matters, but showed that prior to the time the award was made he served notice on the arbitrators that he had withdrawn his consent to the arbitration, and he contended, therefore, that the arbitration was had and the award made without authority, and was consequently not binding upon him. It is conceded that the plaintiff did undertake to withdraw his consent to the arbitration before the award was made, and the hearing was ex parte, and the only question in the case is whether an agreement to arbi — 149 — trate, such as this one, is revocable prior to tbe making of tbe award. Tbe submission was drafted with care and at some length, and it is not necessary to set it all out in this opinion. This submission or agreement to arbitrate specifies tbe matters in controversy, names tbe arbitrators, fixes a date for tbe bearing, includes some other details, and then provides: “Said award and judgment for costs will be made tbe decree of tbe chancery court of Overton county, Tennessee. An execution may be issued thereon as fully as if this cause bad been brought in said court in tbe first instance.” This agreement contains no specification that tbe submission itself shall be entered of record in any court, but only provides that tbe award be entered and enforced in the chancery court of Overton county. It is admitted that at common law an agreement to arbitrate, unless made a rule of tbe court, is revocable at any time before tbe award is made; and tbe law is equally plain that an award made after notice of revocation to tbe arbitrators is void, for tbe revocation terminates the authority of tbe arbitrators. It is urged, however, that our statute changes tbe common law in this respect, and it becomes necessary, therefore, to investigate the statutory provisions that obtain in Tennessee, which are contained in tbe Code of 1858, carried into Shannon’s Code, section 5188 et seq: — 150 — “5188. All causes of action, whether there he a suit pending therefor or not, may be submitted to the decision of one or more arbitrators, as hereinafter provided. (1851-52, ch. 173, section 1.) “5189. The submission may be made by any party in interest, or by an executor, administrator, guardian, trustee, or assignee for creditors, or it may be made by a trustee for a married woman, with her consent made in open court and entered of record, or by writing proved by privy examination as in case of conveyance. “5190. The submission shall be by written agreement, specifying what demands are to be submitted, the names of the arbitrators, and the court by the judgment on their award is to be rendered. (1851-52, ch. 173, sec. 1.) 5191. The submission may be of some particular matters or demands, or of all demands which one party has against' the other, or of all mutual demands. “5192. The agreement may specify that the submission be entered of record in any court of law or equity, or, in cases within their jurisdiction, before a justice of the peace. (1851-52, ch. 173, sec. 2.) “5193. On proof of such agreement, or by consent of parties in person or by counsel, it shall be entered in the proceedings of the court, or on the docket of the justice, and an order made that the parties submit to the award, which shall be made in pursuance of such agreement. “5194. Upon such proof or consent, the judge may, in vacation, make upon the agreement the order men — 151 — tioned in the last section, and such order shall have the same force and effect as if made in terms. “5195. Ho such submission shall he revocable after the agreement is signed by the parties or entered of record, without leave of the court or justice, except by mutual consent entered of record.” Considering the last three sections quoted, it is seen that section 5192 provides that “the agreement may specify that the submission he entered of record,” etc., and that section 5193 provides for the entering of such agreements in the proceedings of the court, and for the entering of an order requiring the parties to submit to the award, and section 5194 provides for the entering of a ..life order by the judge in vacation, and section 5195 provides that “no such submission shall he revocable after the agreement is signed by the parties or entered of record, without leave,” etc. After what agreement is signed? Hot the agreement to arbitrate, but the agreement to enter the submission of record. “Ho such submission” shall be revocable. What sort of submission? A submission entered of record or agreed to be entered of record. The meaning of these sections of the Code is made quite plain by reference to the original act (chapter 173, Acts of 1851-52) : “Persons desiring to end any controversy, whether there be a suit pending therefor or not, may submit the same, in writing, to arbitration, and agree that said sub — 152 — mission may be entered of record in any court of law or equity and in cases within their jurisdiction before jus-' tices of the peace, upon proof of such agreement out of court, or by consent of parties given in court, in person or by counsel, it shall be entered in the proceedings of such court or justice and, thereupon, a rule shall be made in pursuance of such agreement. “Sec. 2. Be it enacted, that no such submission entered, or agreed to be entered of record in any court, or before any justice of the peace, shall be revocable by any party to such submission, without the leave.of such court or justice, and such court may enlarge the term within which an award is required to be made.” It is obvious that by this act it was intended to confer^ on the courts authority to make an agreement to arbitrate a rule of court, whether there was a suit pending with reference to the controversy or not. By the common law the courts had no such power, unless there was a suit pending with reference to the dispute. Halliburton v. Flowers, 12 Heisk., 25; 5 Cyc., 48. This act provides that the parties may agree that such submissions to arbitration shall be entered of record, and upon proof of such agreement a rule shall thereupon be made, etc. In order that such submissions may become a rule of court, and, therefore, irrevocable, it is certainly necessary that the parties agree that they may be entered of record. There is no such agreement here, either on the face of — 153 — the submission, nor is any such agreement, otherwise proven. In other words, this submission is not entered of record, or agreed to be entered of record, and it is, 'therefore, not such a submission as section 2 of the act declares irrevocable. In order to render a statutory “submission irrevocable, the submission must come within the terms of the statute, and the right to revoke the common law submission is not affected.” 5 Cyc., 59. The Tennessée statute clearly makes irrevocable only such submissions as are entered of record, or at least agreed to be entered of record. For the reasons stated, we are of opinion that the plaintiff below was within his rights in revoking the authority conferred on the arbitrators to settle the aforesaid controversies, and that the subsequent proceedings by the arbitrators were without effect upon the plaintiff’s rights, and the award was void. The judgments of all the lower courts are accordingly here reversed, and judgment will be entered for the plaintiff against the defendant for the amount of his note, with interest. To avoid any misapprehension, it perhaps should be added that we do not here decide that a mere agreement to enter a submission of record renders the submission irrevocable, without an actual entry thereof. This is a matter still open to controversy and does not — 154 — arise Rere. The profession differs about tbe proper construction of tbe statute in this respect. Wbat we do bold is that, under no construction of tbe statute, does a mere agreement to enter tbe award as a judgment of court make tbe submission irrevocable. To effect that end, if tbe submission itself is not entered of record, there must at least be an agreement that it may be so entered.